Business Sim Corp. (BSC) issued 1,000 common shares to Kelly in exchange for $12,000. BSC borrowed $30,000 from the bank, promising to repay it in two years. BSC purchased computer equipment for $40,000, signing a six-month note for $5,000, and paying the balance with check number 101. BSC received $900 of supplies purchased on account. BSCs loan contains a clause (covenant) that requires BSC to maintain a ratio of current assets to current liabilities of at least 1.3.

Calculate the current ratio of BSC.

Current Ratio
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Denominator

Whether BSC is complying with or violating its loan covenant.

BSC is

loan covenant.